What Would the Rapture Do to Real Estate Prices?

Scribes from Jonathan Edwards to Robert Frost have ruminated about the end of the world, but few have been willing to suggest a precise date on which it will occur. Perhaps this is part of the reason that the media -- as well as millions of people -- held their breath for a moment last Saturday, the day on which California-based Christian broadcaster Harold Camping predicted that the world was going to end.

The 89-year-old preacher arrived at that date through a complex series of calculations and idiosyncratic Biblical interpretations. Ultimately, though, the way that he calculated humanity's expiration date is less important than the interest that his prediction generated. The notion of the Rapture, a final reckoning in which the righteous are called to heaven, has seized a powerful place in the public imagination -- and inspired movies and books ranging from 2012 to Tim LaHaye's popular Left Behind series.

The Big Question: What Happens to the Houses Left Behind?

While the broader impact of mankind's final days raises some powerful philosophical and theological questions, I live in New York, where everything from environmentalism to religion is filtered through the lens of rents and property values. Camping predicted that everyone who wasn't called into heaven would be completely obliterated, but other theorists -- including LaHaye -- imagine a post-Rapture world in which those who are not pulled into heaven will remain on Earth. Which leads to an important question: Where will those who are left behind hang their hats?

Recent events -- notably Wall Street's 2008 meltdown -- would seem to suggest that bankers are not among those who will be raptured, which means that some version of the current rental/mortgage structure would likely be a part of the post-Rapture world. Admittedly, a plummeting supply of tenants and landowners would likely drive prices down, but would the effect be consistent across the country, or would certain areas be especially hard hit? In short, what would a post-Rapture real-estate market look like?
Will We Stay or Will We Go?

The first problem with calculating the effect of a Rapture on real estate lies in determining how many people would actually disappear. Predictions range from 144,000 -- about 0.0024% of the world's population, to about half of us, the amount of people who were left behind in Tim LaHaye's series.

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However, even if an average of 50% of Americans manage to stay around after Rapture, it seems likely that the post-Rapture numbers would vary wildly from region to region. In a 2009 poll, Gallup determined that roughly 65% of Americans stated that religion was an important part of their lives. Leaving aside questions of denomination and issues of who, exactly, God will call to heaven, this offers a useful entry point into the world of post-Rapture real estate.

If we use the Gallup numbers as a guideline, and assume that the median worship states would lose exactly half of their citizens, the remainder of the states would distribute out to a fairly standard bell curve. Mississippi would lead the pack, with roughly 70% of its citizens called to heaven; on the opposite side of the spectrum, only about 27% of people in Vermont would be raptured. Pennsylvania -- a median state -- would lose 6,351,189 people, or 2,452,196 households (according to the census, the average American household has 2.59 members). In terms of pure numbers, the biggest population drop would be in California, which would lose over 15 million people. The smallest drop -- in both pure numbers and percentage of population -- would be in Vermont, which would only lose about 169,000 people.

What would a 42%-70% Population Drop Do to Real Estate Prices?

These raw numbers hint at the real estate impact that a LaHaye-style Rapture might have. In New York City, for example, a 49% drop would reduce the city's population to 1910 levels. In the short run, this would cause property values to plummet in the city, but the effects would quickly spread beyond mortgages and rents.

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Dr. Andrew Schiller, founder and president of Neighborhood Scout, theorizes that, in the months following Rapture, New York's far-flung exurbs in New Jersey, Westchester County, Long Island and Pennsylvania could conceivably empty out, as the city's property values would plummet. In New York itself, "Gentrification would likely stall in places like Queens and Brooklyn, as well as amenity-free enclaves like Jersey City and many parts of the Bronx." Effectively, he argues, this would turn the clock back 40 years or more, to an era in which low rents made it much easier for middle-class residents to choose neighborhoods based on preference, not price.

Outside of urban centers, Schiller suggests, Rapture would likely be a final nail in the foreclosure coffin, as "People holding on by their fingernails would be more willing to let go of their houses." A large part of this would be linked to the urban mobility issue: As more convenient properties with rapidly-dropping prices became available, underwater mortgage holders would be less inclined to desperately cling to their old homes.

"For suburban neighborhoods that are fighting against failure," Schiller notes, "this could accelerate the process." Municipalities, facing large stretches of empty houses, might be inclined to adopt the solution that Detroit and Youngstown, Ohio, are currently pursuing: "tearing down old homes and seeking adaptive uses for the land."

This is assuming a post-Rapture world in which the political and economic systems would remain relatively stable -- admittedly, a somewhat unrealistic expectation. For that matter, it seems likely that the remainder of humanity, having seen half of its number called into heaven, would be inclined to draw more closely together, further accelerating urbanization. However, even if everything else stays the same, one thing is clear: The Rapture would have an apocalyptic effect on real estate.